highest level in 12 years. the s&p at its highest level since january 2008 spurred on by strong economic numbers and the european central banks saying it will buy bonds from troubled countries. also president obama says it will take a few more years.

a few more years for the u.s. to solve its economic problems. tonight he will tout his so-called promises kept over the past four years at the democratic national convention. a celebration of failure. that's what mitt romney called it. did he keep his promises -- obama that is. why should his contract be renewed as president clinton said last evening. speaking about president clinton and his fine speech last night, tonight we have to take a look at something he said last evening. take a listen. >> when times are tough and people are frustrated, angry, hurting and uncertain, the politics of constant conflict may be good. but what is good politics does not necessarily work in the real world. unfortunately the faction that now dominates the republican party doesn't see it that way. they think government is always the enemy. they are always right and compromises weakness.

>> it's good advice that the politics of cooperation are better than the politics of conflict. it has not happened under president obama in washington, d.c. which leads me to another big story tonight. a new controversial book by famed journalist bob woodburg posits the notion that congress wrestled control of government from a weak, ine if he can si president. if congress and the president don't get together we are headed for a fiscal cliff recession. we begin with barack obama set to accept the party's nomination for re-election as president. we know a little bit of what he'll say. john harwood joins us with the details. good evening, john. >> good evening. bill clinton's speech represented a hand-off to president obama. he gave that full endorsement of the president's economic policy, said no president could have solved the problems in just four years then walked on stage and gave a hug to president obama who, after bill clinton finished

speaking. the excerpts we have indicate that the president will strike a tone of realism. he said out's going to take a few years to solve problems that they have spent decades building up. he said, you have elected me to tell you the truth. we need bold experimentation fdr used. obama aids tell me they are going to do more to sketch out the path forward in a second term. not a policy list. it's not a state of the union speech. he'll try to give americans the sense of what they will get if they are patient. where he's going to take the country on policy. we'll see if this last night of the democratic convention can be as successful as the first two. i talked to a republican congressman today. they said their convention is better than ours. the question is whether it matters. >> john, let me ask you. does he refer directly to fdr in the speech and say we are going to have experimentation? >> yes. he does. he also says that people in the

democratic party need to recognize that ideas they may have worked in the past don't work. trying to strike a little bit of the new democrat theme that bill clinton used where he challenged the party and said party orthodoxy may not be the right thing. he's done it on free trade but it was mostly rhetorical. he hasn't gotten a lot done beyond approving the agreements president bush began to negotiate. we'll hear more in that vein tonight from the president. >> many thanks to john harwood who is on the floor of the convention. john and i will be part of tonight's cnbc especially coverage immediately following the broadcast. turning to our big story tonight, strong market rally on wall street. here is what you need to know. brian shactman has the run-down. good evening. >> thank you very much. 2% across the board for the strongest rally since late june. since we talk about politics the market's at the highest levels of the obama presidency. talk about timing.

pretty good on a day like today. we want to put the rally in more calendar context the t. for the s&p we are looking at levels not seen in more than four and a half years. the dow the last month of 2007 and the nasdaq gets the prize, touching nearly 12-year high. in terms of sector, six of the ten up more than 2% paced by materials and financials. some big names outperformed in the marketplace today. let's take a look at those. we have bank of america up 5%. again you have goldman sachs, three and a quarter. citigroup four and a half. jpmorgan four and a quarter. morgan stanley 3.5 to the upside. amazon, high of 252 pulling back slightly. they introduce new kindles. gives me an opportunity to show you incredible charts in stock market history. 12,679% to the upside. back to you. >> many thanks, brian.

since march of 2009 the dow and s&p have doubled. the nasdaq up 147%. i regard the rally as a function of rising profits which are almost identical to the stock market gains. i want to say this. i also believe that stock markets incorporate all available information on the economy, on politics, on the health and welfare of the nation. some people out there, and i must give them their due, some are calling this the obama stock market rally, going all the way a back to march of 2009. the question i have is will president obama tout this tonight or might it be a little too capitalist for him to do so? let's turn to the market pros. here are the cnbc all-stars. brian kelly, cofounder of shelter harbor capital. cnbc anchor uh simon hobbs and cnbc's rick santelli. i don't want to spend the segment on this.

i do want to begin with you, b.k., and ask you. stocks rising under obama. the stock market liked president obama. do they like his policies? right now with today's rally, clinton handing the baton. do they want obama to win? is that possible? >> i don't think so. since 2009 on the list of ten things i look at during the day, number 11 . uh today going forward i look at the two parties. i'm looking at tax increases or spending cuts which for me aren't the best thing for earnings dprout. this is a ben bernanke rally from the beginning. he did a beautiful job managing the delinchs process. let's hope we have the power to keep this thing going. >> rick santelli, thanks for staying with us tonight. double there is an obama factor in the stock market rally? stocks doubled since march of 2009. look, i have guys saying this to me. they are tweeting to me and they

say, kudlow, you argue stocks cover politics and the economy. i do. i want to be fair. >> i don't think they rally in it in. i would say no. in the end, b.k. has it nailed. it isn't about whether the president will lose, whether mitt romney will win. this is about the cheap money ben bernanke created. if it wasn't the case, why do we spend most of the day debating whether we'll have qe-3 and how it will affect the market. the quick answer is if you look at the in-flows of funds, of course bob pisani talks about it. it's mostly outflows. volume is light. the money is cheap. you have professional traders in a very legal way gaining many of the programs. they are getting lots of leverage and lots of cheap money going into the asset class commonly referred to as the stock market. >> fair enough. thank you. we'll be back.

simon, do you want to take a whack at it before you tell us about the ecb buying bonds? do you want to take a whack at the romney versus obama stock market business? >> it's about holding it together. both sides of the aisle achieved it. that was a contribution from both of them that it didn't collapse. that's what you will see in europe. a belief that draghi set out a plan that can stop europe falling apart. it was a backstop against the tail risk that the euro zone would fall apart. >> can uh you help me on a couple of things? conditional ti. does that mean they have to live up to fiscal conditions? or will he buy spanish bonds come hell or high water? >> in the news conference it was hammering again about conditional ti. this is a plan that tries to bring all of europe with the exception of the bank president to another place.

he had to sacrifice a lot. if spain asks for a bailout, if the germans are willing to offer a bailout, that could create chaos and turmoil moving forward. you see a strong rally today. he's handing it over. >> this is a double edged sward. is it, number number two, they say they will sterilize the bond purchase meaning when they buy the bonds they are not going to create new money. they are going to be buying bonds to drive down the rates. they are really not pumping out new money or easing in a strict central bank sense. >> true. they are not. the mechanics of what they are going to do is create electronic money to buy those bonds. then they are going to offer deposits, probably at one basis point which is what they have been doing. that doesn't mean the banks have to put the money on deposit. the banks can keep the money, put it into the economy and you

could have a proper quantitative easing. >> they are not going to sell paper on the other side to absorb the new liquidity? >> they are. but it doesn't mean anybody has to buy the paper. they have had failed liquidity operations before. several times over the last couple of years that people have not shown up to the auction. >> is this ecb bond buying action what drove the market today? >> absolutely. 100%. that's what it was. no question about it. you saw that. i think the sterilization is lip service to the germans so they could get it through politically. you saw the big news today. the death of the bundus bank today. they don't have the power they had in europe. >> rick, we did have decent news coming out of the usa. the ism services index beat expectations. adp private survey beat expectations. jobless claims did fall. things aren't quite as bad. we are not going into recession. some people are raising their jobs forecast for tomorrow,

rick. what's your take on the american economy and these numbers today? >> i think we are on a glide path that probably isn't recession their. it's not going to be enough probably to create the type of jobs we need to displace population a shifts, people moving in and out of the work force. 201,000 on adp wasn't bad. i am looking for better than expected tomorrow. i think 160,000. i think the salient point here is that the president probably like bill clinton will highlight positives. ben bernanke sees none of the positives. he fully expects the next fed meeting no matter what the data says that we'll get more quantitative easing. doesn't make sense to me or a lot of people. i agree. i think the economy is chugging along. it's not nearly as bad as europe. i think it makes me a bit depressed. i don't think we could completely delink from europe but we missed an opportunity to make a bigger cushion against the head winds that certainly are going to keep coming back if

their answer and solution to things like 24% unemployment in countries like spain is the printing press. that will stabilize but that isn't the answer. >> simon hobbs, i don't know if you know how it works. i once worked in the government in the office of management and budget. >> under reagan. >> indeed. president obama will know the jobs number. he gets it about 4:30 in the afternoon. do you think there will be hints in tonight's state of the union? do you think he'll be ebulent because he knows it is a good number or sadder because it's a bad number? >> i guess he'll cover the bases. he's going to talk about the need for sacrifice going forward, whatever happens. >> if you get a couple hundred jobs and beat all expectations might he linger and say jobs are improving? everyone will be listening. >> i would like him to explain why when clinton says it will take more than four years why there are 48 million people on food stamps, 23 million people unemployed. if he can answer why we are in

this situation. >> those are crucial questions. we'll cover it later in the program. that's the exact question. you don't think he'll give us a hint? >> he's where he is because he's excellent. >> you're still long gold? >> still long my gold position. you can be long of europe and also be long u.s. stocks but be careful. >> okay. brian kelly, thank you very much. rick, you're terrific to help us. simon hobbs, we appreciate it. see simonhor "squawk box" eve -- "squawk boon the street" evy morning at 9:00 a.m. up next, obama making his case to the american public. his theme, promises kept. now we have to wait a few more years for recovery. that's what simon hobbs alluded to. haley barbour faces off with kaseen reed. free market capitalism is the best path to prosperity.

i would like to hear more about it in the democratic convention. we'll be right back.

welcome back. you are looking at a live picture of the democratic

convention in charlotte, north carolina, where everybody is getting set for president obama to speak around 10:00 p.m. eastern. last evening former president bill clinton asked them to renew barack obama's contract with america for four more years. the speech was heavy on numbers and policy. the question, does it all hold up under scrutiny. so we go to eamon javers, here to fact check. >> we look at the speech by former president clinton last night. it won't surprise you to learn politicians pick and choose facts carefully. there is what he said and also what he didn't say. starting out with the question of what the deficit was, take a listen to what bill clinton said. >> republican economic policies quadruple the national debt before i took office. in the 12 years before i took office. >> here's the point he didn't

make. of course under president obama the deficit has increased. national debt going from september of 2009 of just over 11 trillion to september of 2012 to over 16 trillion dollars. obviously that's a point bill clinton didn't make last night. clinton talked about the economic recovery in the 1990s. here's what he did say. >> thankfully by 1996 the economy was roaring. everybody felt it. >> here's what he didn't mention. this is the nasdaq chart. look at the drop around 2000. that was a bit of an economic decline that happened as the dot com bubble burst and caused a recession. clinton not mentioning that. on the deficit he said barack obama endorsed something that was similar to simpson bowles. here's what bill clinton did

say. okay. we don't have the sound bite. what clinton said is that barack obama endorsed something similar to the simpson bowles commission. what he didn't say and we should point out is that of course barack obama was presented with that simpson bowles commission report. he didn't take it up, didn't do anything with it and let it die. so although he might like the ideas in it, he didn't do anything with it when he had the chance. >> i think your factoid on that one is dead on. i remember he walked away from it. thanks very much. up next on "kudlow" president obama makes his case to the nation tonight. the theme of the address, promises kept which may be the problem with our economy. i don't spend money on gasoline.

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president obama takes the stage in charlotte. the theme will be promises kept. it makes me think it could be a short speech. we have atlanta mayor kasim reed and former mississippi governor haley barbour, a founding partner of bgr group. your judgment has president obama kept his promises on unemployment. he said it would be down to 6%. as you know it's at 8 .3. >> he kept the country from plummeting into a great depression. i think bill clinton laid out how grave the circumstances are. i think the american people understand it clearly and we'll hear about it tonight. >> governor barbour, i will give

you a shot at the same thing. they said unemployment would drop to below 6% if the stimulus package went through. the package went through. we are sitting at 8.3%. what's your take on it? >> of course they didn't keep that promise. unemployment continues to be higher. what i couldn't believe about president clinton, well, one of the things i couldn't believe, to say we hadn't had another recession like this where the president did better as if ronald reagan had never been president. the recession was deeper. unbelievable interest rates. unbelievable inflation. unemployment of 10.8. what do you think the people would say if the statement was born in again in america. reagan completed from a much longer recession much more in the way of jobs. more growth and the american people know it. >> the governor couldn't be more

wrong. you know the u.s. economy, the gdp was contracting between 0 and 5%. he knows we were losing more than 600,000 jobs a month. we were never in that position with reagan coming into office. that wasn't the case when president reagan. i know president reagan did a lot of good work. it's simply false. the other part is this. you know the entire time when president obama has been in congress since the republicans have taken power that he hasn't had a dance partner and has been blocked in every front.

unlike what president reagan had. >> the funny thing about my being so wrong, this economy, the recession ended before most of barack obama's policies went into effect. the stimulus package had not gone into effect. for those of us that lived through the obama recovery, it's worse than most recessions. it's never been bigger. >> you weren't saying that when bush was president. you weren't saying it when president bush was losing hundreds of thousands of jobs. you never made that comment then. president barack obama has created more jobs during his president than your friend george bush did in eight years. >> you know, it's funny -- >> the facts bear it out. might be funny to you. >> i'll tell you what's funny to me. when george bush was running for

re-election after four years unemployment was well under 6%. may have been under 5%. >> yes. >> we had 52 straight months of job growth under george bush. so, yeah, at this stage i would rather have george bush's record to run on. you know what? so would barack obama rather to have george bush's record to run on in 2004. >> you should tell it to the hundreds of thousands of people losing their jobs at the end of his term. the fact of the matter is at the end of george bush's term the u.s. economy was in a freefall and you know out. that's why we had to have t.a.r.p., multiple bailouts, bail out the banks and the auto industry went over a cliff. >> haley barbour, let me just ask you. a couple of promises here. president obama said a couple years ago he was going to reduce the budget deficit by half. unfortunately the last four have been over a trillion dollars.

we have had skyrocketing debt, now 16 trillion dollars. do you think these are going to be political issues in this election? does the country care about deficits and debt and those broken promises? >> well, of course, the country cares because the country knows the government can't spend itself rich any more than their family could spend itself rich. we have had the four largest deficits in the history of the united states. four deficits in excess of a trillion dollars each so that more than a third of all the debt ever run up in the 236-year history of the united states, more than a third of it was under barack obama's presidency in the last three and a half years. who's going to pay off the debt? our children and a grandchildren. that's who is going to pay it off. that's where romney and paul ryan are calling for a growth agenda where we can start creating jobs in this country and not have economic growth of

1.7%, under 2% and a federal reserve board that believes we'll be in this shape for two years. that's why they say they will keep interest rates for another two years. >> you heard him talk about the debt created under president obama when the country was going off a fiscal cliff and the banks were seizing up. he never referenced the 5 trillion in debt generated under george bush while he was governor. he never referenced the two wars we didn't pay for. george bush was the first president in the history of the union to go to war and give people a tax cut instead of paying for it. he doesn't address the fact that the central policy for mitt romney's economic plan is a $5 trillion tax cut that will blow a hole in the deficit. every serious economy has said that a $5 trillion tax cut on top of the $1 trillion in bush tax cuts will blow a hole

through the economy. you never hear mention of that. these folks want you to have amnesia. he never mentions what happens. >> in eight years, no president has ever done it in eight years. obama has done it in less than four years. we need a fact check here. >> let's do a fact check on whether it was contracting between 0 and 4% and we were headed toward a great depression. >> we had a very large financial collapse right at the end of the bush administration. it was over in june of 2009 according to the economists. >> you're both terrific. both making strong points. mayor, uh appreciate you coming wrong. governor haley barbour, thank you for coming on.

maybe we'll have the same twosome go at it again. maybe obama will say he'll need a few more years to get america's problems solved. really? [ male announcer ] at scottrade,

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welcome back to "the kudlow report." president obama will say he needs a few more years. those are his words. to get america's problems solved. a few more years of what? the same failed policies? polls show no one believes this stuff will work. for some reason president obama wants to stick with the program. it's the same program that has failed. here now is veteran democratic strategist robert shrum, nan hayward and the ceo of the independent women's voice. heather, bill clinton said it was a bad recession. obama has done the right thing. he said essentially no change. just stick with the program. i have seen democratic pollsters, republican pollsters

say people don't believe the program will deliver. why do you think clinton said we should wait and apparently obama will say the same thing. >> clinton couldn't possibly say he needed to change if obama will say he needs to stay the same. that would violate clinton endorsing him. obama promised he would be a one-term president if we didn't see economic recovery in three years. that promise has gone by the wayside along with many others. you have a man who really has never had any private sector experience, who doesn't understand how economics works, who believes you can operate by central planning fiat and by incremental measures and durnt understand long-term planning to real investment who thinks government makes investments when if you knew about investments you wouldn't do it for the government. >> bob shrum, what john harwood reported earlier from excerpts in obama's speech, he's going to talk about fdr and

experimentation. i don't know what you think of that, but it could mean changes are coming. when i hear experimentation, i'm not sure what to think. it may be different. >> this whole discussion is naive and precooked. the fact is the president will go out tonight and he'll come up with bold proposals, talk about a vision for the country and the future. he'll be honest that this mess took a long time to create. it will take time to come out of it. look, the last businessman, really big businessman was herbert hoover. i'm not sure private sector experience. >> george bush. >> he was a failed businessman. he bought into it. by the way, i would also say i wouldn't brag about the bush economic record. he's the guy who dumped all of this -- this incredible mess into the lap of pram. i think you guys are frustrated

because clinton was so good -- >> clinton deregulated the banks, deregulated fannie mae and freddie mac and repealed glass steagal. >> actually george bush made them give out the subprime mortgages, not bill clinton. larry, get your facts right. >> with respect, i disagree with you. >> how about the facts? >> they are facts. >> i'm sorry. under bush they tried to go under fannie mae. >> this guy tried to shut down fannie mae and freddie mac. >> subprime loans. >> andrew cuomo and bill clinton. >> no, it didn't. >> barney frank saying it was solvent. >> i'm sorry i'm talking so much, but you have a balanced panel here. >> nan, do you think his argument of four more years or three more years or whatever will work? that was the argument clinton made last night. it seemed like the precursor to

obama's argument. do you think america will vote for a guy who is telling them they have to wait several more years for economic success? >> americans, based on my experiences are representative of the hudson valley in new york. americans are fed up. they are desperate for change, but not the kind of change president obama, based on the experience of four years of his policies, has provided to us. so they want to see the kind of change from economic growth. when clinton spoke last night about his presidency and alluded to triumphs when there were troubles he neglected to mention the great engine of the economic growth among others -- >> you guys -- newt gingrich did it. go out and tell people that. >> bob -- >> do you know what's going to happen in the hudson valley? you will defend voucher care and sean romey will stand up for

medicare and people will say they don't want that change. >> we're sorry you want medicare to go bust. >> it goes bust sooner under romney. he takes the savings from insurance companies and gives it back to them. >> if you remember -- >> you guys don't like the clinton speech, do you? >> i liked it. >> good. >> some parts of it i agree with. >> it was just light on facts. >> it was full of facts. >> it was through rose-colored glasses, ignoring reality. >> clinton had great economic achievements but worked with a republican congress. >> he ignored the engine of growth which was the dot com boom. that came from enterprise. as far as medicare goes -- >> the dot com boom went bust as you may remember. >> it's cut and kill medicare. >> that's a lie. it is a lie you keep telling.

>> 16 billion -- >> no, excuse me. there is not a single penny cut from medicare benefits. you want to voucherize benefits you will cost seniors hundreds of dollars more a year. >> excuse me. the president himself -- >> may i ask heather -- this is a neutral question. if president obama does come out with specifics tonight -- in my head i have a line in the excerpts from the speech that like fdr he's going to talk about experimentation. he did say he may have new things to unveil. here's the question. if he unveils new specifics, will that put the pressure on governor mitt romney to be more specific about his own economic plan because in his convention speech there was only a couple hundred words about romney's economic plan. it disappointed me and a lot of people. can obama put pressure on romney to come up with details for his plan? >> i would love out if romney would. i think one thing romney needs to explain is unlike the left we

believe capital and labor go together. we believe markets are actually the engines of growth and that we, in fact, are not the habijians they claimed we were. we believe private sector and private voluntary sector is where you find real solutions. conservatives tend to be consistently more charitable on every measure than liberals do whether it's blood transfusions, donations or time. the challenge with obama providing specifics is that over the last three and a half years, when he's had a proposal he played out, it's in specific-ish, vague terms and there is never an actual plan. never anything to look at. >> that's absolutely wrong. >> it's true. >> he sent job bill after job bill. >> only things his own congress won't vote for. >> not his own congress. the republicans in the house blocked every measure.

you don't have to grab my arm. you're wrong. >> the democrats -- >> the house voted 0 for the president's plan. >> no, no. wait a minute. >> there is huge support in the house and senate for the president's job. mitch mcconnell said the aim was to defeat the president. you care less about the jobs of americans than you do about getting back the job of the president. >> we'll have you all back. explain it to the hudson valley, whatever. bob, thank you very much. house member nan hayworth and heather higgins. we appreciate it. coming up, the price of politics. the debt ceiling fiasco with an ineffective president obama charging that congress has taken over. could charge a recession if we don't fix it.

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a new controversial book by famed journalist bob woodward claims president obama has been so ine if he can wall in his relationship with congress they have no choice but to wrestle control away from him. in his book woodward claims president obama announced congress is taking over. so here now is famed journalist

major garrett, white house correspondent, national journal. one quick thought on this. if these guys can't get their act together after the election when we are going to have the lame duck, we are going to have a fiscal cliff recession. everybody in the country is going to be, a, angry and, b, pissed off of. >> you're right. this is a crucial issue for the politicians who keep kidding themselves and keep telling voters it's your responsibility. democrats and republicans can't move off the bases far enough to cut a deal which is why president clinton couldn't cut a deal with john boehner. you and i have been around a long time. if, in fact, washington does nothing in the lame duck session, doesn't even extend the existing policy for six or seven months which theoretically everyone wants to do, then washington for the first time will with the foreknowledge

impose about this country a recession. no external factors. internal home-baked political ones will send this country into recession. >> because of leadership. >> right. >> now apparently in the book, first of all obama was furious that he couldn't make a deal with boehner. boehner says obama raised taxes another $400 billion at the last minute and walked away. what's interesting to me is boehner said, and i have heard it from others and you probably have, too. boehner said nobody is really in charge in the white house. that was the problem. the whole staffing structure, nobody could make a decision. >> larry, this is all about trust. president obama's staff doesn't trust them. professional republicans never hear from the president personally. john boehner is so furious he never gets a call. never gets a senior level call from the chief of staff or other relevant people on key issues from the white house. it galls him. he'll think the legislative process through the senate and

presidency. neither side cut a deal. both sides are trying to blame the other. the fact is this was set in motion by the 2012 election. house republicans told them if you don't match the increase in the debt you don't get an increase in the debt ceiling. they drove the debate in that direction. that miscalculations led to the country losing the credit rating temporarily and a political crisis we are living with. >> let's talk about the political crisis. apparently bob woodward says in the book that no one is really running washington, d.c. at all. of course we had a credit downgrade because of that last year. we may get another one, precisely because nobody is running washington. >> there is an old saying in washington. if you don't have the votes, you don't have s. and s. doesn't rhyme with squawk. if you have the votes you have

leverage. john boehner had the votes to drive the president toward a deal with spending cuts. he couldn't bring the republicans along though there were some tax increases on the table. president obama could not contemplate significant entitlement reform large enough to satisfy republicans. never did the twain meet. that was on the table. they can come back to it when they wanted to. if they are determined to sit down, lock the door and cut a deal. no one is prepared. >> do you think mitt romney will use it in the debates and on the campaign trail. do you think romney will say, look, i know how to make a deal without giving up my principles? i know how to bring people together, roll up my sleeves. i'm a turn around guy. is he going to stress that? obama couldn't, but i can. >> he may try to stress that, larry. the polling data is solid on this. the country thinks more often than not republicans in the house have been the obstructive factor. if mitt romney says being the

house republicans we'll solve it. he's going to have a credibility problem ahead of him. mitt romney may say i can bring democrats and republicans. he leaves democrats out of the equation, the public will be skeptical with reason. >> many thanks, major garrett of the national journal. up next, mitt romney call it is democratic national convention a celebration of failure. are democrats celebrating bigger government and a nation of dependence? we'll debate. my volt is the best vehicle i've ever driven.

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thank you, gentingmen. senator murphy, we know you are busy. bill clinton once upon a time said the era of big government is over. from president obama it looks like the era of big government is now the democratic mantra. your thoughts? >> if you look around me people are celebrating incredibly. what they are celebrating is empowering america from the bottom up. through the individual, through the family. that can be a partnership but it all starts there, not from the top down. >> okay. t.j. rogers, welcome back. i will ask you the same question. are the democrats the party of big government? do they want to interfere with industries across the economy? how do you see it? >> of course. they are spending twice as much money as they take in in tax

revenues. they are using it for unproductive government programs, cash for clunkers is one example. they want to raise taxes farther to pay for their excess spending. they have to get smaller and more efficient. that's what's wrong with the economy today. that's why we have 8% unemployment. >> senator, i want to ask you about the tax and spend charge. t.j. made it. others made it. raise tax rates in order to increase spending on various functions many the government. that suspiciously sounds like a big government play. >> we did a combination of revenues and cuts. here we are. we have gone with a gap from 14% of gdp in revenue and 23% or so in spending. that's unacceptable. we have to pull up the revenues where they were before and pull down spending and meet in the middle and have a path that doesn't throw us back into recession. >> t.j., when you hear raising tax rates on top earners and you

hear the president say you didn't create that business what signal does it send? >> almost everyone in america believes people at the top end should pay at least what working people are paying. those special deals that have been cut need to be trimmed back. >> we can use the class warfare arguments all we want. we can talk about the bad guys that are rich. i'm one of them. the fact is simple. if you tax me more, you will take money i don't use. you will take money that i invest and i will guarantee you with a company that created 3500 jobs and with a second company i'm chairman of that created the largest solar company in the world. my investments create more jobs than government shovel-ready programs. you are going to shift from productive investors like t.j. rogers to programs that are not productive and make the economy worse. >> t.j. rogers, a lot of people are saying in a second obama term there will be more

regulation. regulation particularly from the epa but regulation throughout the economy, whether it's finance or health care, what's your take on that? >> if the regulation is at big banks and it belongs to small business and families rather than becoming hedge funds it is a good traffic light. >> why do we need the government to decide to lend money? why can't we let the free market move money toward the best opportunities? >> i have to get out. thank you. i apologize for the truncated segment. [ male announcer ] let's say you need to take care of legal matters.

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